ProPublica Article: Freddie Mac Wouldn't Refinance Mortgages and Prevent Foreclosures. Why? It Wanted to Keep Its Profits High and Did Not Want to Stimulate the Economy.

This ProPublica article by Jesse Eisinger explains that, during the depths of the Great Recession, Freddie Mac would not lower consumers' interest rates because it wanted to keep its profits high. Here's an excerpt:

Freddie Mac, the taxpayer-owned mortgage giant, made it harder for millions of Americans to refinance their high-interest-rate mortgages for fear it would cut into company profits, present and former Freddie Mac officials disclosed in recent interviews. ... [T]wo Republican-leaning board members and at least one executive resisted a mass refi policy for an additional reason, according to the interviews: They regarded it as a backdoor economic stimulus. Freddie's policy was financially brutal: During the worst years of the Great Recession, when homeowners most needed the savings they could have gotten from refinancing to lower interest rates, Freddie helped keep millions of borrowers locked in high-interest-rate mortgages. A more aggressive refi program by both Freddie and its sister company Fannie Mae would have helped an additional nine million homeowners to refinance, saving them nearly $75 billion in interest payments to date, Columbia University housing economist Christopher Mayer estimates. In addition, it would have prevented hundreds of thousands of delinquencies and foreclosures, he says.